exv10w20






Exhibit 10.20



[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934 as Amended.




AMENDED SUPPLY AGREEMENT




     This Amended And Restated Supply Agreement is effective as of May 12, 2008 (the
“Effective Date”) by and between Endwave Corporation (“Buyer”) and Northrop Grumman
Space & Mission Systems Corp., acting through its Space Technology sector (“NGST”).



     Whereas, Endwave and NGST entered into a Supply Agreement with an effective date of
June 30, 2006, which is being amended and superseded by this Amended and Restated Supply Agreement
as of the Effective Date;



     Whereas, Buyer desires to purchase and NGST desires to provide, the Products as
specified in Exhibit A to this Agreement and the parties desire to define the terms and conditions
under which the same will be furnished;



     Now, Therefore, in consideration of the foregoing, and for other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:



ARTICLE 1

Definitions and Priority




     1.1 Definitions: The following words and phrases shall have the meanings set forth below:



	 	 	 	 	 
	          Agreement:	 	This Supply Agreement between NGST and Buyer including the following
Exhibits, attached hereto and made a part hereof:
	 
	 	 	 	 
	 

	 	Exhibit A:
	 	List of Products and Services
	 

	 	Exhibit B:
	 	List of Deliverables, Quantity Commitments, and
Buyer’s Site
	 

	 	Exhibit C:
	 	Buffer Inventory
	 

	 	Exhibit D:
	 	(Document [*])
	 
	 	 	 	 
	          Buffer Inventory:	 	Defined in Section 5.5.
	 
	 	 	 	 
	          Contract Price:	 	Defined in Section 4.1.
	 
	 	 	 	 
	          Delivery Date(s):	 	The date on which a Product leaves the NGST Plant.
	 
	 	 	 	 
	          NGST Plant:	 	Each of the factories or establishments of NGST and its
suppliers located in the United States.
	 
	 	 	 	 
	          Products:	 	The products and services described in Exhibit A to be supplied by NGST.






 









 






	 	 	 	 	 
	          Site:	 	Buyer’s facility or other location identified in Exhibit B as
the destination to which transportation is to be arranged for deliverable
items.
	 
	 	 	 	 
	           Term:	 	Defined in Article 3.






     1.2 Priority: In case of any inconsistencies between this Agreement and any of the Exhibits,
the text of this Agreement shall prevail.



ARTICLE 2

Subject Matter of Supply; Requirements; Use of Products




     2.1 Supply: NGST hereby agrees to sell to Buyer and Buyer hereby agrees to buy from NGST, on
and subject to the terms and conditions contained in this Agreement, the Products listed in Exhibit
A. During the Term, Buyer may elect to purchase optional Products as described in Exhibit A under
the terms and conditions set forth in this Agreement. To the extent that Buyer wishes to purchase
more than the maximum quantities of the Products as provided in Exhibit B, NGST may, but is under
no obligation to, provide Buyer such excess quantities. For the purchase of products not described
by this Agreement (including Exhibit A), a separate purchase order shall be used by Buyer and the
parts will be subject to the terms and conditions of this Agreement.



     2.2 Use of Products: Buyer understands and agrees that the Products to be sold by NGST
hereunder are neither designed nor warranted for use in medical devices with life support
functions, safety equipment (or similar applications where component failure would result in loss
of life or physical harm), and military or space applications or environments. Any use of Products
in these applications or environments is at Buyer’s sole and exclusive risk.



ARTICLE 3

Effective Date and Term




     This Agreement shall be effective and binding on the parties as of the Effective Date and
shall remain in force and effect until April 30, 2009, unless the parties choose to extend the Term
of this Agreement (the period between the Effective Date and the termination of this Agreement
shall be hereinafter referred to as the “Term”).



ARTICLE 4

Contract Price, Taxes

Transportation, Expenses and Charges




     4.1 Price: Buyer shall pay to NGST, as and for the performance of NGST’s obligations
hereunder, the prices for Products stated in Exhibit A in accordance with the provisions of Article
5. The aforementioned price is hereinafter referred to as the “Contract Price.”



     4.2 Taxes: All taxes (excluding income, but including stamp, withholding, value added and
turnover taxes), duties, fees, charges, or assessments of any nature levied by any governmental
authority in connection with this transaction, whether levied against Buyer or


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 







NGST, or employees of NGST as a result of Products provided by NGST under this Agreement,
shall be for Buyer’s account and shall be paid directly by Buyer to the governmental authority
concerned. If NGST is required by law or otherwise to pay any such levy and/or fines, penalties,
or assessments in the first instance, or as a result of Buyer’s failure to comply with any
applicable laws or regulations governing the payment of such levies by Buyer, as NGST’s exclusive
remedy for claims under this Section 4.2, the amount of any payments so made by NGST shall be
reimbursed by Buyer to NGST upon submission of NGST’s invoices and written documentation justifying
NGST’s invoices.




     4.3 Transportation Expenses: Buyer shall pay for all expenses of handling, freight,
in-transit insurance, and other transportation expenses including, without limiting the foregoing,
all special handling charges for air shipment incurred in connection with the delivery of Products
from the NGST Plant to the Site. Buyer will provide NGST with a common carrier account number for
NGST’s use hereunder.



ARTICLE 5

Orders, Forecasts, and Buffer Inventory




     5.1 Orders: Buyer shall use purchase orders or scheduling agreements to order Products or to
specify subsequent changes to Products, which reference this Agreement and which specify the part
number, quantity, mutually agreed upon per unit price, desired Delivery Date(s) and shipping site
for Products (the “Order”). Any such Order shall not contain any preprinted or written terms and
conditions, and, to the extent that it does, Buyer and NGST hereby agree that such terms and
conditions of sale shall be superseded by the terms and conditions contained in this Agreement
shall govern any sale between the parties regarding the Products.



     5.2 Acceptance of Orders: NGST shall give Buyer written acknowledgment of its receipt and
notice of its acceptance or rejection of any Order within [*] days after receipt of such Order. If
NGST rejects any Order, it shall specify in such notice the reasons for rejection and the
conditions upon which it would consider accepting the Order. NGST shall use reasonable commercial
efforts to accept and supply all Orders for Products which Buyer submits hereunder, and unless
otherwise agreed, NGST shall deliver Products so ordered on or before the Delivery Dates specified
in each Order. Notwithstanding the foregoing, NGST shall have no obligation to accept and shall
not be deemed to have accepted unless specifically accepted in writing, any Order (i) for any
Products not listed in Exhibit A hereto or revisions thereof; (ii) for any quantity of Products in
excess of the quarterly maximum quantities specified in Exhibit B hereto or revisions thereof; or
(iii) that does not comply with Sections 5.3 and/or 5.4. The parties’ key contacts for management
of Orders shall be:



     Endwave:      [*]



     NGST:          [*],



     5.3 Forecast Orders: Commencing on the Effective Date and thereafter on a mutually agreed
upon business day of each week during the Term hereof, Buyer shall submit to NGST a rolling,
written forecast of its best estimate of its requirements for Products during the next succeeding
[*] week period. Unless otherwise agreed by the parties, the forecast shall be in


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 







the form of an Email file attachment and shall represent a firm, non-cancelable Order for
Products from Buyer for the first [*] weeks of each such forecast period, and Buyer’s best
estimates of its requirements for Products for the balance of the forecast period. The weekly
Forecast Order shall list separately for each week during the period covered by the forecast the
amounts of Products which Buyer expects to purchase during such period by Product part numbers,
quantities of Products, and Delivery Dates or the shipment week. Buyer may request an increase in
Product quantity to its [*] Order or request that NGST expedite the quantity of specific Products
within the [*] window, subject to NGST’s acceptance. Buyer’s Product and delivery requirements for
Weeks [*], inclusive, of each forecast represent Buyer’s best estimate of its Product needs for
that period, are for planning purposes only, and are non-binding on Buyer or NGST. As part of its
acceptance of an Order as set out in Section 5.2 above, NGST shall provide Buyer a written shipment
plan (‘Shipment Plan’), within [*] business days of receiving Buyer’s weekly Forecast Order.




     5.4 Forecast Delivery:



          5.4.1 Shipping Process: Buyer is responsible for shipping documentation with each Order which
verifies the shipping destination, purchase order number, Buyer and NGST part identification
numbers, quantity, unit and total values of each part. NGST has agreed to prepare the shipping
documentation on behalf of Buyer at the same time a shipment is boxed. NGST will email the
shipping documentation to Buyer for review, signature, and return to NGST. If the shipping
documentation is not signed and returned to NGST via Email or FAX by close of business Friday of
any week in which a shipment is scheduled, then NGST may ship the Order to Buyer’s Diamond Springs
facility. Prior to shipping to Diamond Springs, NGST will alert and elevate the request for signed
shipping documents to Buyer Management and provide Buyer one business day to remedy the situation.
This default Delivery location will preserve the continuity of the parties’ Forecast Order
schedule.



          5.4.2 Changes: Pending availability of Products, Buyer may accelerate deliveries of Products
from the date stated in Buyer’s initial Order forecast. NGST may fill the requested increase from
either NGST’s existing inventory or from the Buffer Inventory. If NGST elects to use the Buffer
Inventory, NGST will notify Buyer of such buffer draw-down with the transmission of the next
Shipment Plan. Upon such notification, Buyer may instruct NGST to either re-build parts back up to
the initial buffer inventory level as described in Exhibit C, or permanently lower the buffer
inventory level for the affected part(s). Unless otherwise directed in writing within [*] business
days that such use of buffer inventory constitutes a permanent draw-down of Buffer Inventory by
Buyer, NGST shall replenish Buffer Inventory as soon as practicable. NGST will promptly notify
Buyer if it is unable to accelerate the delivery of Products as requested by Buyer.



     5.5 Establishment and Use of Buffer Inventory: NGST shall establish and maintain an inventory
of the Products identified in Exhibit A in the quantities set forth in Exhibit C (“Buffer
Inventory”). NGST shall insure that [*] of the Buffer Inventory for each Product is available for
shipment within [*] business days of NGST’s receipt of Buyer’s written Order therefor; the
remaining [*] of the Buffer Inventory for each Product shall be available for delivery by NGST to
Buyer within [*] days of Buyer’s Order therefore, unless otherwise used as a result of drawdown in
accordance with the provisions of Section 5.4.2.


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








     5.6 Purchase of Buffer Inventory: Upon expiration of the Term, Buyer shall purchase all
Products remaining in the Buffer Inventory at the Contract Price promptly upon receipt of NGST’s
invoice; provided, however that if, in any [*] day period during the Term, Buyer fails to purchase
a minimum of [*] of an individual Product’s Buffer Inventory level, Buyer shall purchase the entire
Buffer Inventory of that Product at the Contract Price promptly upon receipt of NGST’s invoice.



ARTICLE 6

Payment




     Payment for Products shall be [*] days from the date of NGST’s invoice. Payment of other
charges, if any, provided for in this Agreement shall be due and payable with immediately available
funds within [*] days after the date of NGST’s invoice therefor. Payment shall be made by
electronic funds transfer (EFT) to NGST’s account of immediately available funds as follows:


[*]

[*]

[*]

[*]

[*]




ARTICLE 7

Shipment, Title, and Risk of Loss; Export of Products




     7.1 Delivery of Products: NGST shall place Products in the possession of a common carrier at
a time and date reasonably calculated to effect delivery to Buyer on or before the date or dates
specified in each Order therefor for delivery to Buyer, FOB NGST’s Plant to the Site specified in
Exhibit B. NGST shall place Products in the possession of a common carrier pursuant to the
Delivery Date(s) specified in each Order, but no more frequently than once a week. The cost of
such shipping shall be borne by Buyer.



     7.2 Protection and Packing of the Products: NGST shall arrange to have all Products suitably
packaged in accordance with good commercial practices. Unless otherwise provided, all packing
containers used by NGST shall be non-returnable.



     7.3 Risk of Loss and Title: Notwithstanding any provisions for payment of freight or
insurance, or the form of shipping documents, or the breach or default by NGST at the time of loss,
title and risk of loss for Products shall pass to Buyer on delivery to the carrier at the NGST
Plant. Title and risk of loss of Products sent to NGST for adjustment shall remain with Buyer
until such are received by NGST. Neither (i) the time, method, place, or medium of payment
provided for herein, or any combination of the foregoing, nor (ii) the manner of consignment
provided for, whether to, or to the order of, Buyer or its agent, shall in any way limit or modify
the rights of NGST as the owner of the Products, to have control over the right to possession of
the Products until title thereto passes to Buyer as provided herein.



     7.4 Shipping Documents: After Products have been shipped, NGST shall deliver to Buyer one (1)
copy of the packing list. Electronic delivery of the packing list is authorized.


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








     7.5 Export of Products: All sales hereunder shall at all times be subject to the export
control laws and regulations of the United States and any amendments thereto. Buyer agrees that it
shall not make any disposition, by way of transshipment, re-export, diversion or otherwise, except
as such laws and regulations may expressly permit, of Products. Further, Buyer agrees that it
shall not knowingly sell, transfer, or deliver, directly or indirectly, any part or portion of the
Products or related documentation supplied by NGST pursuant to this Agreement to any person or
organization in any country where such sale, transfer, or delivery by Buyer would be prohibited by
law or regulation now or hereafter in effect which imposes any restrictions on United States trade
with foreign countries.



     7.6 Acceptance of Products: A signed air bill or other common carrier documentation
indicating receipt by Buyer of the Products constitutes proof of delivery. Buyer will provide NGST
with written notice of acceptance of the Products that conform to the applicable Order within ten
(10) business days of receipt; provided, however, if Buyer fails to provide NGST with either
written notice of acceptance or a formal statement of rejection and the reasons therefore within
ten (10) business days of receipt, such Products shall be deemed accepted upon expiration of the
ten (10) business day period. Acceptance shall be definitive and final in all cases, absent fraud.
Following such acceptance, Buyer’s only remedy for defective Products shall be as provided in
Article 8.



ARTICLE 8

Warranty




     8.1 Warranty:



          (a) NGST warrants that title to all Products delivered to Buyer hereunder will be free and
clear of all liens, encumbrances, security interests and other restrictions.



          (b) NGST warrants that for a period of 24 months after the Delivery Date all Products sold
hereunder (i) are made from new materials and (ii) meets the production circuit screening criteria
set forth in the then current and applicable test D-document for that Product, as identified in
Exhibit A hereof, at the time on wafer circuit screening occurred. NGST further warrants that
(iii) it will only ship Products from wafers which have met a [*] sample visual inspection and
contain no less than [*] of its Products passing the requirements of [*] attached hereto as Exhibit
D (the “Inspection Criteria”) for the [*] sample. For each Product that fails to satisfy the
requirements of (i), (ii) or (iii) above, NGST shall, at its option, either issue a credit to Buyer
or replace such Product with a similar Product, in all cases free from defect without charge and
with reasonable promptness.



          8.1.1 Return on Shipped Products: Buyer will immediately inspect and record incoming Products
subject to the Inspection Criteria. Such recordation shall include quantities of passed and failed
Products segregated by part type, and justification for any claimed failures. Buyer will retain
said records and any claimed failed Products for a period of three months or until the next
scheduled quarterly meeting of the parties, whichever is soonest. Upon discovery of suspected
failed product per 8.1, the buyer shall notify seller of the failure and request an RMA to ship the
suspected failed product back. NGST shall review and respond within 5 business days either with an
RMA number to return the product or a request for further


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 







discussion to understand the failure and root cause. Buyer’s records of failed Products will
be discussed by the parties and a decision mutually made as to whether each Product is subject to
return to NGST under an RMA for replacement or credit.




          8.1.2 RMA Procedure: If it is determined by the parties that a quantity of Products failed
the Inspection Criteria, Buyer will request an RMA number from NGST for each part type to be
returned. For each Product, NGST shall make all replacements at NGST’s Plant. Buyer will ship RMA
Products from its Diamond Springs facility, and NGST shall return replacements for defective
Products to Buyer at the place where the defective Product was located when shipped to NGST and
will pay for such return shipment. Under no circumstances will NGST compensate Buyer for post-pay
field return costs incurred by Buyer in returning defective Products to NGST. All defective
Products replaced by NGST as herein provided shall become the property of NGST when the replacement
occurs, unless held for analysis by Buyer with NGST’s prior written consent. All Products replaced
by NGST shall remain under warranty for the remainder of the warranty period on the Products. The
warranty specified in this Section 8.1 does not extend (i) to Products which fail or are damaged
due to use or storage by Buyer in a manner or environment not conforming to NGST’s published
instructions and specifications in effect at the time such Products are delivered to Buyer; or,
(ii) to Products that are modified by Buyer or any person other than NGST. Buyer and NGST agree
that circuit screening in accordance with the applicable test D-document is the sole method of
determining the presence or absence of a defect affecting electrical performance in individual
Products on wafer as warranted in (ii) above.



     8.2 Exclusion: OTHER THAN THE WARRANTY FOR THE PRODUCTS SET FORTH IN SECTION 8.1 HEREOF, NGST
DOES NOT MAKE ANY WARRANTY, GUARANTEE OR MAKE ANY REPRESENTATIONS, EITHER EXPRESS OR IMPLIED,
INCLUDING MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, WHETHER ARISING BY LAW, CUSTOM,
CONDUCT OR USAGE OF TRADE, AND THE RIGHTS AND REMEDIES PROVIDED HEREIN ARE EXCLUSIVE AND IN LIEU OF
ANY OTHER RIGHT OR REMEDIES. PRODUCTS USED IN APPLICATIONS FOR WHICH THEY ARE NOT INTENDED AS SET
FORTH IN SECTION 2.2 HEREOF, ARE SOLD WITHOUT WARRANTY AND ON AN “AS-IS,” “WITH ALL FAULTS” BASIS.



ARTICLE 9

Delays




     9.1 Force Majeure: No failure or omission on the part of either party to carry out or observe
any of the terms or provisions of this Agreement or any Order hereunder (except the payment of
money) shall be deemed a breach of this Agreement or such Order if same shall arise or result from
force majeure or from any cause reasonably beyond the control of Buyer or NGST, as the case may be,
including but without limitation, acts of God, acts (including delay or failure to act) of any
governmental authority (de jure or de facto), war (declared or undeclared) riot, revolution, fires,
labor disputes, sabotage or epidemics. Should such delay occur, the date or dates of performance
by the affected party shall be extended for a period equal to the extent of the delay expected as a
result of the force majeure event. The affected party shall give the other party written notice of
such delay within five (5) working days after identification of the delay.


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








     9.2 NGST Delays: If at any time NGST discovers that it is unable (whether for reasons set out
in Section 8 or otherwise) to deliver any Products to Buyer on the scheduled delivery date, NGST
shall give Buyer written notice within [*] days of such discovery, which notice shall specify the
delivery date on which NGST shall be able to deliver such Products to Buyer. If the delivery date
proposed by NGST is more than [*] days after the scheduled delivery date, Buyer shall have the
right, without liability, to cancel (in whole or in part) its Order for such Products, by giving
NGST notice of cancellation within [*] days of receipt of NGST’s notification of delay. To the
extent that there are NGST delays as described herein or NGST resulting delays as described herein,
there shall be made equitable adjustments to the purchasing and pricing provisions hereof.



ARTICLE 10

Transfers and Assignments




     10.1 Transfer: Neither party shall, without the consent in writing of the other party, which
shall not be unreasonably withheld, assign or transfer this Agreement or the benefits or
obligations thereof or any part thereof to any other person other than a subsidiary wholly owned by
such party; provided that this shall not affect any right of either party to assign, either
absolutely or by way of charge, any moneys due or to become due to it or which may become payable
to it under this Agreement; further provided, that no consent shall be necessary to the extent that
either party is acquired by merger or other acquisition or either party sells all or substantially
all of its assets relating to this Agreement to a third party.



     10.2 Release of Obligations: No assignment or transfer of any right or duty hereunder by
either party shall constitute a novation or otherwise release or relieve such party of its
obligations hereunder.



ARTICLE 11

Default




     11.1 Event of Default: An Event of Default on the part of either party shall exist under this
Agreement if:



          (a) Such party fails to pay the other party any amount required to be paid hereunder when due
and payable; or



          (b) Such party fails to perform its purchase or supply obligations (as the case may be
hereunder) specified in Section 2.1 during the Term hereof, or otherwise fails to perform any other
material obligation required to be performed by it under any provision of this Agreement within [*]
days after the time specified or within [*] days after written notice from the other party that
such performance has become due; provided, however, Buyer shall have no right to terminate this
Agreement for NGST’s default so long as corrective action is being diligently pursued by NGST in a
manner that reasonably demonstrates that NGST’s obligations hereunder shall be completed in
sufficient time to allow Buyer to reasonably meet its end-use requirements for Products without
incurring additional costs or penalties (as reasonably determined by Buyer), and NGST discloses to
Buyer in writing such corrective action(s).


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








     11.2 Remedies Available for Default: Subject to other provisions hereof which expressly limit
the remedies available hereunder, if an Event of Default as defined in Section 10.1 exists on the
part of either party, then the other party may terminate this Agreement upon giving written notice
of termination and pursue any other remedies available at law or in equity.



ARTICLE 12

Limitation of Liability; Damages




     12.1 Limitation of Liability: NGST’s liability to Buyer on any claim of any kind (excluding
bodily injury or death), whether based on contract, warranty, tort (including negligence), strict
liability or otherwise, for any loss or damage arising out of, connected with, or resulting from
this Agreement or any Order, or from the performance or breach thereof, or from all Products
covered by or furnished under this Agreement or any Order hereunder, shall in no case exceed the
sum of [*] for a single claim, or [*] in the aggregate for all claims arising during the Term. For
the removal of all doubt, a “claim” for these purposes may equate to a single chip causing loss or
damage, even where multiple chips are evidencing the same or common cause defect. Buyer’s
liability to NGST on any claim of any kind (excluding bodily injury or death), whether based on
contract, warranty, tort (including negligence), strict liability or otherwise, for any loss or
damage arising out of, connected with, or resulting from this Agreement or any Order, or from the
performance or breach thereof, or from all Products covered by or furnished under this Agreement or
any Order hereunder, shall in no case exceed the price of the specific individual Product that
gives rise to the claim.



     12.2 Damages: In no event shall either party be liable for any special, indirect, incidental
or consequential damages, however caused, whether by such party’s sole or concurrent negligence or
otherwise, including but not limited to costs and expenses incurred in connection with labor,
overhead, transportation, installation, or removal of Products or substitute facilities or supply
sources.



ARTICLE 13

Notices




     All notices, requests, consents, and other communications required or permitted to be given
under this Agreement must be in writing and shall be deemed effectively given: (i) upon personal
delivery to the party to be notified; (ii) when sent by confirmed telex or facsimile if sent during
normal business hours of the recipient; (iii) five (5) days after having been sent by registered or
certified mail, return receipt requested, postage prepaid; or (iv) one (1) day after deposit with a
nationally recognized overnight courier, special next day delivery, with written verification of
receipt, addressed as follows:



	 	 	 
	     If to NGST:

	 	Northrop Grumman Space Technology
	 

	 	Microelectronics Products & Services (MPS)
	 

	 	One Space Park Drive, D1-1024
	 

	 	Redondo Beach, California 90278
	 

	 	Attention: Contracts
	 

	 	Phone:       (310) 812-2789
	 

	 	FAX:         (310) 812-7011





[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








	 	 	 
	     If to Buyer:

	 	Endwave Corporation
	 

	 	130 Baytech Dr.
	 

	 	San Jose, CA 95134
	 

	 	Attention: James R. Crossen
	 

	 	Phone:       (408) 522-3177
	 

	 	Fax:           (408) 522-3181
	 

	 	jim.crossen@endwave.com






ARTICLE 14

Contract Change Procedure




     14.1 Changes: Any changes to this Agreement after the Effective Date which relate to: (i)
the deletion of Products; (ii) adding additional Products; (iii) changing or modifying Products; or
(iv) making other changes which do not materially alter the scope of this Agreement shall be made
in accordance with the procedures set forth in this Article 14.



     14.2 Contract Changes: Every [*] during the Term hereof, the parties shall revisit the
maximum quantity commitments of the Products. Based on changes in Buyer’s contracts and production
forecasts, the parties may, but shall not be obligated to, negotiate changes to the production
commitments.



     14.3 Contract Chance Notice: If the parties mutually agree to implement a change request, a
standard form Contract Change Notice (“CCN”) shall describe the change. Execution of a CCN by both
parties shall constitute a modification hereof and shall be binding on both parties hereto.



     14.4 Exception: Substitutions relative to Products which are purchased items not manufactured
by NGST may be made by NGST without the consent of Buyer if such substitutes are of like quality
and are available at the same or lower cost to Buyer.



ARTICLE 15

Intellectual Property




     15.1 Proprietary Information: For the purpose of this Agreement:



          (a) “Proprietary Information” shall mean all drawings, documents, ideas, know-how and other
information supplied by one party to another (whether disclosed orally, or in documentary form, by
demonstration or otherwise) for the purpose of achieving the objectives of this Agreement.



          (b) “Proper Use” shall mean use of the Proprietary Information solely by the recipient for the
objectives of this Agreement.



     15.2 Nondisclosure: All Proprietary Information furnished shall remain the property of the
disclosing party and shall be treated by the recipient in strict confidence, shall not be used
except for Proper Use, shall be disclosed by the recipient only to persons within the recipient’s
company (including companies directly or indirectly more than fifty percent (50%) owned or
controlled by the recipient) who are directly concerned in the Proper Use, and shall not be


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 







disclosed to consultants or by the recipient to any other party without the disclosing party’s
prior written consent, except for Proprietary Information that was:




          (a) In the public domain at the time it was disclosed; or



          (b) Known to the recipient without restriction at the time of receipt; or



          (c) Published or becomes available to others without restriction through no act or failure to
act on the part of the recipient; or



          (d) Known to the recipient from a source other than the disclosing party without breach of
this Agreement by the recipient; or



          (e) Subsequently designated by the disclosing party in writing as no longer proprietary;



          (f) Independently developed by the recipient without reference to the Proprietary Information;
or



          (g) Disclosed after [*] years from the date of delivery by the disclosing party to the
recipient, which [*] year period shall survive the termination of this Agreement; provided,
however, that if Buyer, as a result of an agreement with a customer, requires a longer
nondisclosure period, the parties shall agree to such longer nondisclosure periods with regard to
Proprietary Information applicable to such customer’s contract.



     If any portion of Proprietary Information falls within any one of these exceptions, the
remainder shall continue to be subject to the foregoing prohibitions and restrictions. The
recipient of Proprietary Information shall inform its employees of the confidential nature of the
Proprietary Information and shall prohibit them from making copies of any of it except where such
copies are necessary for the purposes of Proper Use, unless agreed upon by the disclosing party.
The recipient of Proprietary Information shall exercise the same degree of care in protecting such
Proprietary Information as it takes to preserve and safeguard its own proprietary information, and
in no event less than a degree of care a reasonable recipient would use to protect its own
proprietary information.



     15.3 Marking: Proprietary Information made available in written form by one party to the
other party shall be marked with the legend:


          “ENDWAVE PROPRIETARY INFORMATION”

or -    “NGST PROPRIETARY INFORMATION”



as the case may be, or an equivalent conspicuous legend. No sheet or page of any written material
shall be so labeled which is not, in good faith, believed by the disclosing party to contain
Proprietary Information. A recipient of Proprietary Information hereunder shall have no obligation
with respect to any portion of any written material which is not so labeled or any information
received orally unless it is identified as proprietary and a written summary of such oral
communication, specifically identifying the items of Proprietary Information, is furnished to the
recipient within thirty (30) days of such disclosure.



[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








     The individuals identified below are the only persons authorized to receive Proprietary
Information on behalf of the parties:


For Endwave:  [*]

For NGST:       [*]




     By written notice to the other parties, these representatives may be replaced by another person
from the same party.



     15.4 Compensation: The parties shall not be obligated to compensate each other for the
transfer of any Proprietary Information under this Agreement and agree that no warranties of any
kind are given with respect to such Proprietary Information or any use thereof. No license is
hereby granted under any patent, trademark or copyrights with respect to any Proprietary
Information.



     15.5 Survival: The obligations of the parties concerning confidentiality set forth in this
Article 14 shall survive termination or completion of this Agreement.



     15.6 Ownership of Masksets: NGST shall retain ownership and sole possession of any and all
glass plates utilized for photolithographic semiconductor processing of MMIC (as defined in Section
15.7 below) designs (“Masksets”) developed or procured by NGST under this Agreement.



     15.7 Ownership of MIMIC Designs: NGST shall retain sole ownership rights to its solely
developed designs for monolithic microwave integrated circuit (“MMIC”) designs. NGST shall also
retain sole ownership rights to individual circuit elements, design libraries, design rule manuals,
and MIMIC fabrication processes for all MMIC designs. Buyer shall retain sole ownership rights to
its solely developed designs for MMICs, including all associated documentation. If any MMIC design
work or maskset fabrication was or will be performed by NGST on behalf of Buyer under a separate
design and development agreement, the terms of such separate agreement shall determine the parties’
respective rights to such MMIC designs.



ARTICLE 16

Indemnification




     16.1 Indemnification by NGST: In the event any Products to be furnished under this Agreement
are not to be made in accordance with drawings, samples, or manufacturing specifications designated
by Buyer, but rather are the design of NGST, NGST agrees that it shall, at its own expense and at
its option, defend or settle any claim, suit, or proceeding brought against Buyer, based on an
allegation that the Products furnished under this Agreement constitute a direct or a contributory
infringement of any claim of any patent, mask work, copyright or any other intellectual property
right. This obligation shall be effective only if Buyer shall have made all payments then due and
if NGST is notified of said allegation promptly in writing and given authority, information, and
assistance for the settlement or defense of said claim, suit, or proceedings. NGST shall pay all
damages and costs assessed in such suit or proceedings. In the event of a final adjudication by a
court of competent jurisdiction that its Products or any part thereof infringes or violates any
third party intellectual property right or if the use or sale thereof


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 







is enjoined, or if the provisions of any negotiated settlement agreement prohibit the use of
the Products, NGST shall at its sole option and its own expense, either:




          (a) Procure for Buyer the right to continue using the Product; or



          (b) Replace the Products with substantially equivalent non-infringing Products; or



          (c) Modify the Products so they become non-infringing but substantially equivalent; or



          (d) To the extent that the options set forth in clauses (a), (b) and (c) above are not
reasonably available, terminate the Buyer’s right to use the Product and return to the Buyer and
return to the Buyer the price originally paid by Buyer to NGST for the Product.



     The foregoing indemnity does not apply to the following:



          1. Infringement by a combination of Products furnished under this Agreement with other
products not furnished hereunder unless NGST is a contributory infringer;



          2. Infringement resulting from changes or modifications made to or from the Products by the
Buyer; and



          3. Any settlements of a claim, suit, or proceeding made without NGST’s written consent.



     The foregoing states the entire liability of NGST with respect to infringement or violation of
third party intellectual property rights in connection with Products furnished under this
Agreement.



     16.2 Indemnification by Buyer: In the event any Products to be furnished under this Agreement
are to be made in accordance with drawings, samples, or manufacturing specifications designated by
Buyer and are not the design of NGST, Buyer agrees that it shall, at its own expense and at its
option, defend or settle any claim, suit, or proceeding brought against NGST, based on an
allegation that the Products furnished under this Agreement constitute a direct or a contributory
infringement of any claim of any patent, mask work, copyright or any other intellectual property
right.



ARTICLE 17

Miscellaneous




     17.1 Headings: The headings and titles to the articles, sections, and paragraphs of this
Agreement are inserted for convenience only and shall not be deemed a part hereof or affect the
construction or interpretation of any provision hereof.



     17.2 Remedies: Unless otherwise expressly provided herein, the rights and remedies hereunder
are in addition to, and not in limitation of, other rights and remedies under the


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 







Agreement, at law or in equity, and exercise of one right or remedy shall not be deemed a
waiver of any other right or remedy.




     17.3 Modification and Waiver: No cancellation, modification, amendment, deletion, addition,
or other change in the Agreement or any provision hereof, or waiver of any right or remedy herein
provided, shall be effective for any purpose unless specifically set forth in a writing signed by
the party to be bound thereby. No waiver of any right or remedy in respect of any occurrence or
event on one occasion shall be deemed a waiver of such right or remedy in respect of such
occurrence or event on any other occasion.



     17.4 Entire Agreement: This Agreement supersedes all other agreements, oral or written,
heretofore made with respect to the subject hereof, and the transactions contemplated hereby and
contains the entire agreement of the parties.



     17.5 Severability: Any provision hereof prohibited by or unlawful or unenforceable under any
applicable law of any jurisdiction shall as to such jurisdiction be ineffective without affecting
any other provision of the Agreement. To the full extent, however, that the provisions of such
applicable law may be waived, they are hereby waived, to the end that the Agreement be deemed to be
a valid and binding agreement enforceable in accordance with its terms.



     17.6 Controlling Law: All questions concerning the validity and operation of this Agreement
and the performance of the obligations imposed upon the parties hereunder shall be governed by the
laws of the State of California applicable to contracts entered into and wholly to be performed in
such jurisdiction.



     17.7 Successors and Assigns: The provisions of this Agreement shall be binding upon and for
the benefit of NGST and Buyer and their respective successors and assigns. This provision shall
not be deemed to expand or otherwise affect the limitation on assignment and transfers set forth in
Article 10 and no party is intended to or shall have any right or interest under this Agreement,
except, as provided in Article 10.



     17.8 Counterparts: This Agreement has been executed in several counterparts, each of which
shall be deemed to be an original, and all such counterparts together shall constitute but one and
the same instrument.



     17.9 Language: If a translation of this Agreement is required or otherwise made, the English
version shall be the official version and shall control in the event of differences. All
communications relating to this Agreement shall be in English.



     17.10 Negotiated Terms: All terms of this Agreement were negotiated between the parties at
arm’s length. The parties agree that in the event a dispute arises in connection with this
Agreement, the terms contained in this Agreement shall be given their plain meaning, and that no
term shall be construed in favor of one party over the other by virtue of one party having drafted
a term in this Agreement.



     17.11 Disputes: All disputes between the parties in connection with or arising out of the
existence, validity, construction, performance and termination of this Agreement (or any terms
hereof), which the parties are unable to resolve amicably shall be finally settled by binding


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 







arbitration, preceded by pre-arbitration mediation if the parties so mutually agree at the
time. The arbitration or any pre-arbitration mediation shall be held in Redondo Beach, California,
or such other venue as the parties may agree, and administered by the American Arbitration
Association under its Commercial Mediation Procedures, or if failing settlement, under its
Arbitration Procedures for Large, Complex Commercial Disputes by three arbitrators appointed in
accordance with the rules. Subject to Article 12, the arbitrators shall have authority to provide
any relief available in law or equity. Judgment on the arbitral award may be entered in any court
or tribunal having jurisdiction thereof, Each party shall be responsible for its own attorney fees
and costs. Each party shall be responsible for its own attorney fees and court costs.




     In Witness Whereof, the parties have executed this Agreement in English as of the
Effective Date.



	 	 	 	 	 
	 	ENDWAVE CORPORATION

 	 
	 	By:  	/s/ [*]
 	 
	 	 	 	 
	 	 	 	 
	 
	 	NORTHROP GRUMMAN SPACE & MISSION
 SYSTEMS CORP.

Northrop Grumman Space Technology

 	 
	 	By:  	/s/ [*]
 	 
	 	 	 	 
	 	 	 	 
	 


[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








EXHIBIT A




PRODUCTS AND PRICING




1. Products




	 	 	 	 	 	 	 
	 

	 	 	 	[*]	 	 
	APPROVED:
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Endwave Corporation

	 	 	 	Northrop Grumman Space &
Mission Systems Corp., Space Technology	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	/s/ [*]
 


	 	 	 	/s/ [*]
 

	 	 
	Date

	 	 	 	Date	 	 





2. Optional Products. Buyer may elect to purchase additional Products in wafer form at prices and
cycle times to be determined by NGST and agreed to by the parties at the time Buyer exercises such
option subject to the ordering procedure described in Section 5.1 of the Agreement.



3. Engineering Support. Engineering support for failure analysis, device troubleshooting, test or
component characterization, mask layouts, and related support, shall be billed per NGST’s hourly
rates then in effect. Material shall be billed as incurred.



[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








EXHIBIT A-1

PRODUCTS AND PRICING

INTERIM FIXED WAFER PRICING




	 	 	 	 	 	 	 
	 

	 	[*]	 	 	 	 
	 
	 	 	 	 	 	 
	APPROVED:

	 	 	 	APPROVED:	 	 
	 
	 	 	 	 	 	 
	Endwave Corporation

	 	 	 	NGST	 	 
	 
	 	 	 	 	 	 
	/s/ [*]
 


	 	 	 	/s/ [*]
 

	 	 
	Date

	 	 	 	Date	 	 





[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








EXHIBIT B

LIST OF DELIVERABLES, QUANTITY COMMITMENTS,

DELIVERY SCHEDULE AND BUYER SITE




1. Deliverables



During the Term, NGST will supply Buyer with MMICs from either [*] Wafers, to be determined by the
parties.



NGST will ensure that all Products delivered to Buyer come from wafers that meet NGST’s PCM
specifications and have passed NGST’s commercial wafer-level sample visual screen criteria.



NGST will perform RF test on the wafers, and will dice the wafers and pick the die into waffle
packs. Die pick and waffle pack may be performed by qualified vendors on behalf of NGST.



NGST will deliver the Products in waffle packs.



Buyer will be responsible for performing visual inspection of the Products upon receipt, and will
bear all costs and yield losses for such tasks.



To minimize re-traying work for NGST, Buyer agrees that NGST may ship Products in either multiples
that coincide with particular full tray quantities for each Product, or quantities rounded up or
down to reasonably meet both Buyer’s forecast and use any remaining partially filled tray.



2. Quantity Commitments. NGST’s maximum quarterly MMIC quantity during the Term shall not exceed
[*] MMICs per quarter.



3. Delivery Schedule. Not to exceed one shipment per week.



4. Buyer Sites




	 	 	 	 	 
	Billing and Notices:	 	Delivery of Products:	 	Engineering/Procurement:
	 
	Endwave Corporation

	 	Endwave Corporation
	 	Endwave Corporation
	130 Baytech Dr.

	 	6425 Capitol Avenue, Bldg 2
	 	130 Baytech Dr.
	San Jose, CA 95134

	 	Diamond Springs CA 95619
	 	San Jose, CA 95134
	Att: [*]

	 	Att: [*]
	 	Att: [*] (unless otherwise specified in the Order)
	 
	Phone: [*]

	 	Phone: [*]
	 	Phone: [*]





[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








EXHIBIT C

BUFFER INVENTORY



Quantities of Products in the Buffer Inventory described in Article 5 of the Agreement are as
follows:




[*]



*NOTE: Die Buffer values will not be established until 3-inch wafer inventory is extinguished.
For these parts ‘Buffer Inventory’ shall be the lesser of the number of wafers indicated under
‘Wafer Buffer’ column or NGST’s remaining wafer inventory. NGST shall not build any additional
3-inch wafers.



Estimated Initial buffer Inventory value based on quantities ordered at prices listed in Exhibit A
is [*] based on current prices and recent history of quotes under this Agreement.



Replenishment Rate: When Buyer issues a purchase order to pull Products from the Buffer Inventory,
nominal refresh time (fab cycle) is [*] weeks.



Pull Rate is within [*] business days.




	 	 	 	 	 	 	 
	APPROVED:
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Endwave Corporation

	 	 	 	NGST	 	 
	 
	 	 	 	 	 	 
	/s/ [*]
 


	 	 	 	/s/ [*]
 

	 	 





[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.




 









 








EXHIBIT D

[*]



[ * ] = Certain confidential information contained in this document, marked by brackets, has
been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934, as amended.